As USD Shortage Deepens, Government Finally Borrows Hundreds of Thousands From Private Party
21 ސެޕްޓެމްބަރު 2026 | ހޯމަ 08:31Amidst a critical shortage of foreign currency and declining usable reserves, a private entity has deposited approximately $2 million into the banking system as a loan to alleviate the crisis. This comes at a time when recent regulatory changes to the financial system have eroded investor confidence and heightened concerns within the tourism sector, prompting experts to urge the government to implement robust measures to stabilize the economy.
President Dr. Mohamed Muizzu expresses his grief at the PPM headquarters immediately following the sentencing of President Yameen. (File Photo). | Social Media
Reliable sources have informed RaajjeMV that the government, facing an acute dollar shortage, has resorted to borrowing hundreds of thousands of dollars from a private party.
A source speaking on condition of anonymity stated that the government, in an effort to find a temporary solution to the dollar shortage, secured hundreds of thousands of dollars from a private party and worked to deposit the funds into the bank on Sunday.
"I am stating this because I am aware of how the funds were obtained; approximately two million dollars were secured from a private source and deposited into the Islamic Bank," said a source familiar with the transaction.
He further stated that the funds were deposited into the Maldives Islamic Bank. The government believes that transferring these funds to their intended destination will provide some relief to the current dollar shortage. The official did not disclose the specific destination to which the Maldives Islamic Bank is transferring the funds.
Amidst heightening concerns from the business community over a severe dollar shortage, official figures from the Maldives Monetary Authority (MMA) reveal that while the nation's official reserves stood at $643.8 million by the end of August, usable reserves have plummeted to just $200.6 million. This amount is sufficient to cover only about 18 days of imports. Experts warn that if the $50 million repayment to the State Bank of India (SBI) was drawn from these reserves, the usable balance would drop to $150 million, reducing import cover to a critical two-week window.
This situation unfolds as the tourism industry—the nation’s primary source of foreign exchange—expresses profound concern over the loss of investor confidence. This decline is attributed to the abrupt legislative and regulatory amendments being implemented by President Dr. Muizzu’s administration. Consequently, some investors have declared their intention to halt further investments in the Maldives. Furthermore, several tour operators have reportedly issued warnings that they may cease marketing the Maldives as a destination.
Financial experts are warning that the Maldives' economic situation is deteriorating due to political decision-making and a lack of accountability. They emphasize that addressing these challenges requires restoring public trust and reforming debt management policies, while cautioning that recent changes to foreign exchange regulations could potentially undermine investor confidence.
Amidst the worsening dollar shortage, the government is also working to secure a $100 million loan from Malaysia.
